Omnichannel shoppers in the beauty and wellness space are volume shoppers.
So said Ulta Beauty CEO Dave Kimbell when explaining the record sales of $10 billion the cosmetics and skincare retailer racked up during the fourth quarter.
“When we get a store-only shopper to start shopping in both stores and online, their spend with us increases by about 2.5 times,” Kimbell told beauty and fashion news site Glossy. “And they end up shopping more frequently in stores, not less frequently.”
Other retailers in the space have reported this as well.
For example, Sephora is expanding its footprint by growing its partnership with omnichannel retailer Kohl’s, having opened 200 store-within-a-stores in 2021 and another 400 in 2022.
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With the addition of these displays, Kohl’s boosted its total beauty sales by 90%, Kohl’s CEO Tom Kingsbury said during a March 1 earnings call.
“Our partnership with Sephora is an excellent example of how we are enhancing the customer experience,” Kingsbury said.
Similarly, Estée Lauder reported in February that a return to physical retail helped the company reduce losses in its most recent quarter and that freestanding stores delivered double-digit organic sales growth globally across all channels, complementing the success it has made with social media campaigns.
“We are also progressively modernizing numerous freestanding stores, as they are primed to be an important contributor to growth following rationalization of the footprints,” Estée Lauder President and CEO Fabrizio Freda said during a Feb. 2 earnings call.
Freda added that the company’s enhanced omnichannel capabilities “are also primed to contribute to growth in the U.S. as consumers we engage with our brands online and in-store drive consistently higher value from upsell and cross-sell.”
In the case of Ulta Beauty, the retailer said in its most recent investor presentation that its omnichannel offering provides a unique and differentiated model that includes 1,300 stores that deliver tangible experiences, product discovery and a human connection, 350 Ulta Beauty at Target locations that help the brand acquire new customers, and digital channels that add “always-on” shopping and consultation services.
“We’re focused on evolving guest experiences through a personalized connected omnichannel ecosystem,” Kimbell said Wednesday (March 9) during the company’s quarterly earnings call. “In fiscal 2022, we continued to enhance the guest experience across all our touchpoints.”
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